Another Car Insurance Question

**woodie96** · 05-07-2012, 11:41 AM

I wouldn't think that having a lienholder would make a difference on the rates when you compare identical coverages.
Lots of time when people pay off their cars, they increase their deductible, or just drop down to liability, which would lower their rates, but to keep the same coverages and deductibles, I don't think it would matter if there were a lienholder or not.

**bjl584** · 05-08-2012, 05:16 AM

Originally posted by herdjohnson View Post

Is car insurance cheaper on a paid off car vs a financed car? And I'm speaking of identical coverage - I realize that financed vehicles often require higher coverage than owned vehicles. Same car, same coverage - is it cheaper if there's no lien?

No, not really. The car is worth X no matter what is financed on it. To repair a car costs X no matter what is financed on it.

If you are looking to lower your rates, raise your deductible. That's about the easiest way to drop your insurance payment.

**snafu** · 05-08-2012, 08:50 PM

Automobile insurance rates are also based on where you live and how many miles you drive. Do you use an insurance broker who ask re-insurers to bid on your contract?

**matthew111** · 05-09-2012, 05:07 AM

I think it does make a difference but I am not sure how may be some senior experts can help us out.

**herdjohnson** · 05-09-2012, 05:09 AM

Originally posted by snafu View Post

Automobile insurance rates are also based on where you live and how many miles you drive. Do you use an insurance broker who ask re-insurers to bid on your contract?

snafu, to be completely honest I have no idea what that means. I use Geico.

**herdjohnson** · 05-09-2012, 05:10 AM

Originally posted by matthew111 View Post

I think it does make a difference but I am not sure how may be some senior experts can help us out.

I had always heard that too, but judging by the responses so far it seems it may have just been an old wives' tale. Darn wives!

**phantom** · 05-09-2012, 06:34 AM

I can only speak from my experience with one insurer, but I know my insurer does not care whether or not my car is financed. I base this on two things: When I had a car financed and paid it off, my rate did not change. When I called to see what my rate would be after buying a new call, all they needed to give me an exact quote was the VIN number (not information about how I would be paying for it).

**bjl584** · 05-09-2012, 07:11 AM

The only thing that will change with a paid off car is your ability to drop collision covergage and go with liability only. Insurance companies require a car to have full coverage if it has a lein on it. But, the actual rate will not change.

**herdjohnson** · 05-09-2012, 09:01 AM

Originally posted by phantom View Post

I can only speak from my experience with one insurer, but I know my insurer does not care whether or not my car is financed. I base this on two things: When I had a car financed and paid it off, my rate did not change. When I called to see what my rate would be after buying a new call, all they needed to give me an exact quote was the VIN number (not information about how I would be paying for it).

That was sort of why I was asking. I'm on a certain timetable to pay my car off, and I was trying to decide if I should borrow some money out of savings to pay it off a little earlier before my policy renewed. If it would drop my rate, then I would. But it appears it doesn't matter.

Thanks for the advice, all.

Another Car Insurance Question